Sometimes homeowners are faced with the proposition of a home not appraising for what the buyer is willing to pay for it. If this happens to you there are steps you will need to take in order for your sale to proceed to closing. If you get stuck with a low appraisal the first thing you will want to do is get a copy of the appraisal report and review it carefully. See: Low Appraisal; Now What? – Realtor.com.
There are cases where a home comes in at a value lower than it should because the appraiser has made an honest error in their report, or forgotten to include or change something. If there are no errors in the report, you should also look at similar properties in your area that the appraiser used to see if they are genuinely comparable. Read: Dealing With Low Appraisals When Buying a House
Sometimes the appraiser isn’t as familiar with the area as well as they should be. There is a good chance the appraisal may be adjusted if there was a judgement error when placing a value on the homes location.
If however, both of these things check out, the last stop is to ask the buyer to get another appraisal done. You will be incurring this cost, so be prepared to pay money for it. This is the time to be honest, and ask yourself if you are being reasonable in regards to the appraisal value. Sometimes, your home just isn’t worth what you think it is.
You need to keep in mind that challenging an appraisal will upset the buyer. The first reason is that they are going to have to spend more time in the wings, waiting to make a deal. The second thing you should realize is that you might be wasting precious time—a buyer may get fed up and begin looking at other homes while waiting on you. For further reading: How to Handle a Low Appraisal on Your Dream Home.
When a buyer will not cooperate after receiving a low real estate appraisal your last resort to keep the sale together would be to reduce your homes sale price to match the appraisal value. A low real estate appraisal can be just as frustrating for the buyer as the seller. Both have gotten their hopes up on the house, and are left disappointed.